U.S. Department of Defense, Education Activity, Arlington, Virginia (Agency) and Federal Education Association (Union)
[ v57 p23 ]
57 FLRA No. 8
U.S. DEPARTMENT OF DEFENSE
EDUCATION ACTIVITY, ARLINGTON, VIRGINIA
FEDERAL EDUCATION ASSOCIATION
(55 FLRA 1108 (1999))
March 28, 2001
Before the Authority: Dale Cabaniss, Chairman; Donald S. Wasserman and Carol Waller Pope, Members. [n1]
I. Statement of the Case
This matter is before the Authority on exceptions to a supplemental award of Arbitrator Marvin J. Feldman filed by the Agency under § 7122(a) of the Federal Service Labor-Management Relations Statute (the Statute) and part 2425 of the Authority's Regulations. The Union filed an opposition to the Agency's exceptions.
The Arbitrator granted the Union's request for attorney fees sought pursuant to 5 U.S.C. § 5596(b)(1)(A)(ii), based on his initial award holding that the Agency violated a memorandum of understanding (MOU) by revising certain regulations without properly informing the Union. For the reasons that follow, we remand the case to the parties for resubmission to the Arbitrator, absent settlement, to determine whether any employees lost pay, allowances, or differentials as a result of the Agency's unjustified and unwarranted personnel action found in the initial award. We deny the Agency's remaining exceptions.
II. Background and Arbitrator's Award
In his initial award, the Arbitrator found that the Agency revised regulations concerning waivers of terminations of employees' living quarters allowances (LQA). The Arbitrator found that the revision of the regulations violated an MOU between the parties because the Agency failed to provide the Union with a document summarizing the revision. Because the Agency failed to comply with the MOU, the Arbitrator held the revision "for naught."
The Agency filed exceptions to the initial award claiming, among other things, that the award was ambiguous. The Authority denied the exceptions, stating the following: "Here, the Arbitrator declared the revised Agency regulations `for naught[,]' Award at 13, but did not direct the Agency to take any specific action. As such, even though the award is not complete in this regard, implementation consistent with its holding is not impossible." United States Dep't of Def. Dependents Schools, 55 FLRA 1108, 1112 (1999) (DoDDS).
Subsequently, the Union requested attorney fees. The Arbitrator granted the Union's request, finding that an award of attorney fees would be consistent with the Back Pay Act, because "[w]ages can be in the form of an allowance which is what has occurred in this particular matter." Supplemental Award at 8. In this regard, the Arbitrator stated that "[i]t is clear from the [initial] decision that the dependants . . . receive[d] an order for funds for quarters and other benefits[,] [and that] [t]he [initial] award reflected . . . that the [MOU] . . . was tantamount and the basis for receiving an award of backpay." Id. at 4-5.
The Arbitrator further found that the number of hours and the hourly rates requested by the Union were reasonable. In concluding that the number of hours were reasonable, the Arbitrator relied on affidavits submitted by the Union and the fact that there was "no evidence to the contrary in the file[,]" and the Arbitrator considered "the extensive law involved [and] the possibility of issues that could be raised[.]" Id. at 6-7. Regarding the hourly rates requested by the Union, the Arbitrator considered the number of years of experience, the type of experience, and the education of the attorneys and law clerk for whom fees were sought. The Arbitrator accepted the Union's method of determining its hourly rates, which was based in part on the Laffey matrix. [n2] [ v57 p24 ]
III. Positions of the Parties
A. Agency's Exceptions
The Agency argues that the award of attorney fees is deficient because the Arbitrator's initial award did not "order the Agency to correct any personnel action or pay any employee a sum of backpay." Exceptions at 5. According to the Agency, "[n]either the Agency's failure to notify the Union of the regulatory change nor the arbitrator's declaration that the [change] was `for naught' resulted in any withholding of pay." Id. at 6. In this connection, the Agency asserts that the award of attorney fees violates the Back Pay Act, because the Arbitrator did not find that the Agency had committed an unwarranted and unjustified personnel action that resulted in a withholding of pay.
The Agency further argues that the award of attorney fees is deficient because the requirements of 5 U.S.C. § 7701(g) have not been met. Specifically, the Agency asserts that the Union has not shown that fees were incurred by the grievants because the existence of an attorney-client relationship has not been established. The Agency also claims that the amount of fees awarded is unreasonable because the number of hours and the hourly rates are excessive. In this connection, the Agency argues that the Union's lead attorney received a substantially lower hourly rate from other arbitrators in the past. Also, the Agency argues that the Arbitrator should not have relied on the Laffey matrix because the Laffey matrix was meant for use in cases involving "complex [f]ederal litigation," and this case was "simple to research and prepare [because] [n]one of the issues were complex." Id. at 9.
B. Union's Opposition
The Union claims that, because the Arbitrator held the revised regulation "for naught" in his initial award, employees who lost allowances as a result of the revision are entitled to backpay. The Union asserts that, "[e]ven though the [initial] award did not specifically mention. . . `backpay,' backpay is included in the award." Opposition at 4. The Union argues that the Authority's prior holding that implementation is not impossible requires that affected employees be granted backpay.
According to the Union, the requested attorney fees are reasonable. Moreover, the Union argues that the Laffey matrix has been accepted by the Authority in cases involving legal issues similar to those involved here.
IV. Analysis and Conclusions
The Agency's exceptions claim that the award violates the Back Pay Act, 5 U.S.C. § (b)(1)(A)(ii), which also incorporates by reference the standards established in 5 U.S.C. § 7701(g). When a party's exceptions involve an award's consistency with law, the Authority reviews any question of law raised by the exception and the award de novo. See NTEU, Chapter 24, 50 FLRA 330, 332 (1995) (citing United States Customs Serv. v. FLRA, 43 F.3d 682, 686-87 (D.C. Cir. 1994)). In applying a standard of de novo review, the Authority assesses whether an arbitrator's legal conclusions are consistent with the applicable standard of law. See United States Dep't of Def, Dep'ts of the Army and Air Force, Alabama National Guard, Northport, Alabama, 55 FLRA 37, 40 (1998). In making that assessment, the Authority defers to the arbitrator's underlying factual findings. See id.
A. Statutory Requirements for Attorney Fees
The threshold requirement for entitlement to attorney fees under the Back Pay Act is a finding that the grievant was affected by an unjustified or unwarranted personnel action, that resulted in the withdrawal or reduction of the grievant's pay, allowances, or differentials. See United States Dep't of the Navy, Naval Undersea Warfare Ctr., Newport, R.I., 56 FLRA 477, 478 (2000) (Dep't of the Navy). Once such a finding is made, the Back Pay Act further requires that an award of fees must be: (1) in conjunction with an award of backpay to the grievant on correction of the personnel action; (2) reasonable and related to the personnel action; and (3) in accordance with the standards established under 5 U.S.C. § 7701(g), which pertains to attorney fee awards by the Merit Systems Protection Board. See id. The standards established under 5 U.S.C. § 7701(g) are: (1) the employee must be the prevailing party; (2) the award of fees must be warranted in the interest of justice; (3) the amount of the fees must be reasonable; and (4) the fees must have been incurred by the employee. See id.
An arbitrator's award resolving a request for attorney fees must set forth specific findings supporting determinations on each pertinent statutory requirement. See United States Dep't of the Treasury, IRS, Phila. Serv. Ctr., Phila., Pa., 53 FLRA 1697, 1699 (1998). When an arbitration award does not sufficiently explain the arbitrator's determination of a pertinent statutory requirement, we will examine the record to see if it permits the Authority to resolve the matter. See Alabama ACT, 56 FLRA 231, 234 (2000) (then Chairman Wasserman dissenting in part as to other matters) [ v57 p25 ] (ACT). If it does not, we will remand the award for further proceedings to assure that the resolution of the request for attorney fees is consistent with law. See id.
B. The Arbitrator Found that the Agency Committed an Unjustified and Unwarranted Personnel Action
The Authority has held that a violation of a collective bargaining agreement constitutes an unjustified and unwarranted personnel action under the Back Pay Act. See United States Dep't of Health and Human Serv., 54 FLRA 1210, 1220 (1998). Here, the Arbitrator expressly found that the Agency was in "clear violation of the . . . collective bargaining [agreement]." Supplemental Award at 8. Therefore, the Agency's assertion that the Arbitrator did not find that the Agency committed an unjustified or unwarranted personnel action is without merit, and the first requirement of the Back Pay Act is satisfied.
C. The Record does not Permit the Authority to Determine Whether the Agency's Unjustified and Unwarranted Personnel Action Resulted in a Withholding of Pay
It is not clear from either of the Arbitrator's awards whether the unjustified and unwarranted personnel action found by the Arbitrator resulted in the withdrawal or reduction of any of employees' pay, allowances or differentials. In this regard, while the Arbitrator stated in the initial award that "the impact of the new regulations is ongoing for many bargaining unit members," the Arbitrator did not find that any of those bargaining unit members lost pay, allowances, or differentials. Initial Award at 9. Moreover, although the Arbitrator found that the "delivering of the new regulations [was] defective," he did not find that this defect caused any employees to lose pay, allowances, or differentials. Id. at 13. The Arbitrator simply held the new regulation "for naught," over the Union's request "that retroactive LQA with interest be granted." Id. at 4, 13.
The Arbitrator stated in the supplemental award that his initial award "reflected that . . . the [MOU was] the basis for receiving an award of backpay." Supplemental Award at 4-5. However, in his initial award, the Arbitrator included no reference to backpay. Indeed, the Authority specifically held, in reviewing the initial award, that the award "did not direct the Agency to take any specific action . . . [but that] implementation consistent with its holding is not impossible." DoDDS, 55 FLRA at 1112. Consequently, the Union's assertion that backpay is included in the initial award is unsupported. In the supplemental award, the Arbitrator further stated that "[w]ages can be in the form of an allowance which is what has occurred in this particular matter," and "the dependants who were involved as a result of [his initial] decision . . . receive[d] an order for funds for quarters and other benefits." Supplemental Award at 4, 8. However, neither the award in particular nor the record in general establishes that employees in fact were denied allowances. Finally, in response to the Agency's argument that backpay has not been awarded, the Union claims only that certain unit employees "should . . . be granted" allowances, not that any employees, or dependants, have been granted allowances. Opposition at 5.
In these circumstances, we conclude that the supplemental award is unclear as to whether any employees lost pay as a result of the unjustified and unwarranted personnel action found by the Arbitrator. We further conclude that the record does not provide a basis for the Authority to resolve the issue. Accordingly, we will remand the award to the parties for resubmission to the Arbitrator, absent settlement, to determine whether any employees lost pay, allowances, or differentials as a result of the unjustified and unwarranted personnel action found in the initial award.
D. Provided that the Award Resulted in the Payment of Back Pay, the Arbitrator Made Sufficient Findings Under 5 U.S.C. § 7701(g) to Award Attorney Fees
Initially, we note that the Agency does not dispute that the grievants are the prevailing parties or that the award of attorney fees is warranted in the interest of justice under 5 U.S.C. § 7701(g). Accordingly, we conclude that those requirements have been satisfied, and we will not address them further. See United States Dep't of the Treasury, IRS, Wash., D.C., 48 FLRA 931, 934 (1993) (citing United States DOD, Defense Mapping Agency, Hydrographic/Topographic Ctr., Wash., D.C., 47 FLRA 1187, 1192 (1993)) (IRS). The Agency challenges the award of attorney fees on the basis of the remaining requirements of § 7701(g). Specifically, the Agency asserts that the award of attorney fees is deficient because the Union has not demonstrated that the fees were incurred by the grievants, and because the amount of fees awarded is unreasonable.
1. The Attorney Fees Awarded by the Arbitrator Were Incurred by the Grievants
Although the Arbitrator did not specifically find that the fees were incurred by the grievants, the record clearly establishes counsels' status as attorneys for the Union that prosecuted the case on behalf of the grievants. The Authority has approved the grant of fees to union counsel on the basis of this representational status. [ v57 p26 ] See ACT, 56 FLRA at 233 (holding that an attorney-client relationship exists when an attorney represents the employee on behalf of a union) (citing United States Dep't of Agric., Animal and Plant Health Inspection Serv., Plant Protection and Quarantine, 53 FLRA 1688, 1691 (1998)). Accordingly, we find that the award of attorney fees is not deficient in this regard.
2. The Attorney Fees Awarded by the Arbitrator are Reasonable
The Agency challenges the reasonableness of the award of attorney fees on( two grounds. First, the Agency claims that the number of hours awarded is excessive. Next, the Agency challenges the hourly rates requested by the Union. We find no merit in the Agency's arguments, and we deny the Agency's exception.
When determining the reasonableness of fee awards, the Authority considers whether the number of hours expended was reasonable and whether those hours, multiplied by the rate, "establish an objective basis on which to make an initial estimate of the value of [the] lawyer's services." IRS, 48 FLRA at 935. Fee requests must be closely examined to ensure that the number of hours expended was reasonable. Id.
"In determining the market rate, the Authority has held that `where an applicant for a fee award has a prior billing history, the reasonable hourly rate will be counsel's established billing rate.'" Dep't of the Air Force HQ., 832D Combat Support Group DPCE, Luke AFB, Ariz., 32 FLRA 1084, 1109 (1988)). However, where the attorneys involved are also employees of a union that does not have a customary billing rate, it is necessary to consider whether the rate requested is in line with the prevailing billing rate "`in the community for similar services by lawyers of reasonably comparable skill, experience, and reputation.'" United States DOJ, BOP, Fed. Corr. Inst., Ray Brook, N.Y., 46 FLRA 1002, 1009 (1992) (quoting Blum v. Stenson, 465 U.S. 886, 895-96 n.11 (1984)). The Authority has previously approved the use of the Laffey matrix in making this determination for attorneys within the Washington, D.C. area. See IRS, 48 FLRA at 936.
The Agency asserts that the number of hours awarded to the Union is unreasonable because the time spent researching and preparing the brief was excessive as compared to the time spent preparing for the hearing, and because the legal issues were simple. However, these assertions are unsupported. As the Union correctly points out, there is no Authority case law requiring that the time spent preparing a brief be less than the time spent preparing for a hearing. Moreover, the Arbitrator relied on affidavits submitted by the Union and found that there was no evidence to contradict the accuracy of the Union's request. The Arbitrator found that "extensive law" was involved and that the Union's preparation included preparation for the possibility of additional legal issues. Supplemental Award at 6. In light of these findings, the Arbitrator concluded that the number of hours requested by the Union was reasonable. Because the Arbitrator's factual findings support his legal conclusion that the number of hours requested by the Union is reasonable, we conclude that the award of attorney fees is not contrary to law in this regard.
Regarding the hourly rates requested by the Union, the Arbitrator found that the Union's lead attorney has extensive experience in labor law, and has practiced law for some 15 years. The Arbitrator further found that the Union's second attorney had gained substantial experience in